TalkTalk Q1 sales fall as number of broadband punters declines

Launches YouView wrapped in stinky new 24-month-contract

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TalkTalk saw 146,000 broadband customers quit the service in the company's first quarter even as its overall subscriber base for all of the telco's products returned to growth.

The past few months of heavy rain in Britain hampered TalkTalk's rate of connections for new customers, the firm added.

It saw growth in fully unbundled customers signing up during the three months ended 30 June, but its total broadband subscriber base once again fell for the fifth consecutive quarter.

TalkTalk said:

Our base of more profitable fully unbundled customers grew by 10 per cent year on year to 3.096 million and by 30,000 in the quarter reflecting the combined effects of continued improvements in churn, and a slower quarter for connections versus Q4.

We returned to positive total customer growth in June but poor weather impacted the rate at which we were able to connect new customers through the quarter, with significantly longer lead times between sign-up and go-live. As a result, our total customer base was 19,000 lower in the quarter than in Q4.

TalkTalk said that it had 146,000 customers fewer customer of its legacy broadband-only product than a year earlier. Its total number of punters stood at just over 4 million as of the end of June 2012.

The budget broadband provider added that demand for fibre broadband remained "modest" among its customers, with only 15,000 subscribers choosing to take a "paid speed uplift".

“It has been an encouraging start to the year," said TalkTalk boss Dido Harding. "We continue to improve customer service and this has been reflected in a further reduction in complaints and churn. We returned to customer growth in June, despite longer lead times on connections, and our base of fully unbundled customers grew by 10 per cent year on year in the quarter."

TalkTalk saw total sales of £414m, down 2 per cent, during the quarter.

The company also reported to the City this morning that it was launching its "free" YouView TV service for its Plus customers, which requires a new 24-month contract for existing punters. New sign-ups will be locked-in for 18 months. ®